NC jobless rate rises to 5.5 percent

North Carolina’s unemployment rate ticked upward in April for the second consecutive month even though the state added 11,100 jobs during the period.

Once again, the influx of tens of thousand of people who entered the labor force in search of work pushed the unemployment rate higher. Jobless workers who are so discouraged that they aren’t actively looking for work aren’t considered unemployed in the government’s data.

The Labor and Economic Division of the N.C. Department of Commerce reported Wednesday that the state’s seasonally adjusted unemployment rate for April was 5.5 percent, up from 5.4 percent in March.

The new jobs added in April – led by 3,900 government jobs – were more than offset by an increase of 7,457 unemployed workers.

“The unemployment rate may not look good on the surface, but the underlying data is very encouraging,” said economist Richard Kaglic of the Federal Reserve Bank of Richmond. “While we like to see the unemployment rate decline, we also want to to see growth in the labor force because that is our potential pool of labor moving forward.”

The state’s labor force swelled by 33,000 workers in April and has expanded 2.4 percent over the past 12 months – more than twice the national average of 1.1 percent growth, Kaglic said.

“That means as firms decide to expand or relocate here, they know they are going to have a growing pool of labor available to them,” he said.

The decline in the state’s unemployment rate from a year ago, when it stood a percentage point higher at 6.4 percent, is all the more impressive given the expansion of the labor force, Kaglic said.

Kaglic said the job growth in North Carolina has been broad-based, with one notable “soft spot” being the manufacturing sector, which lost 1,600 jobs in April.

Looking ahead, he expects especially strong job growth in leisure and hospitality services, professional and business services and in construction as the housing markets rebound statewide, especially in metropolitan areas such as Raleigh and Charlotte.

N.C. State University economist Michael Walden also had an upbeat perspective on the monthly data. He called the uptick in the unemployment rate “a total non-issue” in light of the growth in jobs.

He added that the expansion of the labor force that pushed the state’s unemployment rate up a notch is actually a good sign because it shows that people who previously gave up looking for work have become encouraged about their prospects.

Walden was especially encouraged by the 1,900 construction jobs that the state added in April because “that’s been something it has taken North Carolina a while to generate. I consider that to be a plus.”

“We’re still going to generate jobs (but) we’re continue to continue to bring people back into the job market,” Walden said.

The national unemployment rate declined one-tenth of a percentage point to 5.4 percent in April.

April unemployment numbers for the Triangle are scheduled to be released next Wednesday. The Triangle’s unemployment rate for March was 4.7 percent after seasonal adjustments.

This story was originally published May 27, 2015 at 10:32 AM with the headline "NC jobless rate rises to 5.5 percent."